Odaiko Electronics

A committee to guide Odaiko Ltd., a Tokyo based electronics firm, in its continued
development of information system applications has been established by the firm's senior
management. The committee consists of:
Chief Accountant- Chairman
Vice President Sales
Vice President Corporate Strategy
Executive Vice President
Vice President Finance
Chief Internal Auditor
Two Technical Assistants to the Information Systems Manager
Supervisor of Computer Operations
Director of Employee Benefits

The committee is responsible for reviewing information system project requests and setting
priorities for approved projects. All approved projects are expected to be compatible with the
operating policies and growth objectives of the firm.
A project team is appointed for each approved project, and each team is headed by a systems
analyst.
The committee meets three times a year. The first meeting is setup to discuss problems facing
current systems. Sample subjects discussed are changes in hardware, the need for a data
processing audit functiona, and alternative security measures.
The second meeting allows for an annual reiteration of the five year plan, covering
applications, manpower and hardware. The third meeting is to finalise the annual plan and
budget for next year.
According to the current company policy, user departments pay the cost of all application
developments out of their own budgets. These costs include the time analysts and designers
spend on the project, along with computer time and supplies expenses. The user departments
do not however assume the expenses of running the system after it is developed and
implemented.
However the users and upper level management disagree about whether the committee should
be allowed to approve or disapprove the development of application projects. Many users feel
that if they are willing to pay for the development of an application out of their own budget,
they should be permitted to have the application developed. While users acknowledge the
authority of the committee to establish the priorities among projects to be developed, they
question its authority to disapprove projects that are technically and operationally feasible.
Although the users concede that IS Department members need to be on the committee to
advise other members about technical problems, other projects under development and
general information systems issues, the users do not believe that these members should be
allowed to vote on project requests. The users believe that since the information systems
group members on the committee will neither pay for the project nor use it if it is developed,
they should not be able to influence the decisions on whether projects are technically feasible.
 ANSWERS

 There is no representee from Production & Manufacturing in the committee.

 There are three representees from IS department in the committee.
 Two technical assistants to the IS manager
 Supervisor of computer operations.
 The three representees from IS department should be replaced by only one representee from
IS department.
 This representee can be the manager of IS department.
 There is not enough vertical representation in the committee.
 There are too many senior managers, it is a top-heavy committee.
 Chief Accountant (chairman) should be replaced by Chief Operating Officer (chairman)
because it is a manufacturing firm.
 Vice President of Finance should be replaced by a departmental manager from finance.
 Executive Vice President should be removed from the committee because:
 He/she puts too much pressure on the committee
 He/she doesn’t know the detailed information
 Vice President of Sales should be replaced by a middle manager from sales like Head of Sales
& Marketing.
 Having the Chief Internal Auditor in the committee is a wise move because he/she directly
reports to the board of directors.
 Director of Employee Benefits should be replaced by an another middle manager from HR,
like Head of Human Resources.
 After the changes, the committee consists of:
1- Manager of IS department
2- Chief Operating Officer (chairman)
3- Head of Finance
4- Head of Sales & Marketing
5- Chief Internal Auditor
6- Head of Human Resources
7- Vice President of Corporate Strategy
 Seven members is enough but if you want to make it 9, you can add:
8- Middle Manager from Production (like Quality Control Manager or Product Designer)
9- Middle Manager from Marketing
 To decide on which system should be developed first, Porter’s Value Chain Model can be
used to determine it.
 Selecting a system analyst as the head of project team is a good decision.
 Also BA graduates can be selected as the head of project team too because they are
knowledgeable about all functional areas within a company.
 The committee meets three times in a year:
1- First meeting is about maintenance.
2- Second meeting is about developing and reviewing IS plan.
3- Third meeting is about finalizing the annual plan and budget for the next year.
  Order of meetings can be change, it can be 2-1-3.
 Paying for the system development doesn’t mean that it should be developed because:
1- The system may not parallel with the overall objectives of the company
2- The system may not compatible with legacy systems of the company
3- The system may be too complicated to develop.
 Representees from IS department should be in the committee and have a voting right because:
1- They know whether the proposed system compatible with legacy systems or not.
2- They know whether the proposed system can be developed or not.
3- They are knowledgeable about the technical side of. The feasibility study.